1. An asset manager wishes to reduce his exposure to large-cap stocks and increase his exposure to small-cap stocks.He seeks to do so using an equity swap.He agrees to pay a dealer the return on a large-cap index, and the dealer agrees to pay the manager the return on a small-cap index.Assume that payments are made semi-annually.The notional principal is $100,000,000

The Value of the small-cap index starts off at 689.40, and the large-cap index starts at 1130.20.In six months, the small-cap index is at 625.60, and the large-cap index is at 1251.83

What is the total amount that the asset manager will pay to (or receive from)the dealer? [Note: You should use a positive number to represents the amount the asset managerpayto the dealer.You should use a negative number represents the amount that asset managerreceivefrom the dealer]

1. A US company enters into a currency swap in which pays a fixed rate of 5.5% in euros and the counterparty pays a fixed rate of 6.75% in dollars.The notional principals are $100,000,000 and 116,500,000 million.Payments are made semi-annually and on the basis of 30 days per month and 360 days per year.

Calculate the semi-annual payments that the US company receives from itscounterparty.

1. A US company enters into a currency swap in which pays a fixed rate of 5.5% in euros and the counterparty pays a fixed rate of 6.75% in dollars.The notional principals are $100 million and 116.5 million.Payments are made semi-annually and on the basis of 30 days per month and 360 days per year.

For the initial exchange of payments that take place at the beginning of the swap, is the US company paying USD or EURO to the counterparty? [Type in USD or EURO in the answer box]

1. A US company enters into a currency swap in which pays a fixed rate of 5.5% in euros and the counterparty pays a fixed rate of 6.75% in dollars.The notional principals are $100,000,000 and 116,500,000 million.Payments are made semi-annually and on the basis of 30 days per month and 360 days per year.

Calculate the initial exchange of payments that the US company pays to the counterparty.

1. A US company enters into a currency swap in which pays a fixed rate of 5.5% in euros and the counterparty pays a fixed rate of 6.75% in dollars.The notional principals are $100 million and 116.5 million.Payments are made semi-annually and on the basis of 30 days per month and 360 days per year.

Calculate the final exchange of payments thatthe US company receives from itscounterparty.

1. A US company has entered into an interest rate swap with a dealer in which the notional principal is $50 million.The company will pay a floating rate of LIBOR and receive a fixed rate of 5.75%.Interest is paid semi-annually, and the current LIBOR=5.15%.What is the total amount that the asset manager will pay to (or receive from)the dealer? [Note: You should use a positive number to represents the amount the asset managerpayto the dealer.You should use a negative number represents the amount that asset managerreceivefrom the dealer]